<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
<TABLE>
<S> <C>
/ / Preliminary Proxy Statement / / Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
IRT PROPERTY COMPANY
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/X/ Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
IRT PROPERTY COMPANY
200 GALLERIA PARKWAY, SUITE 1400
ATLANTA, GEORGIA 30339
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO BE HELD MAY 31, 1995
To the Shareholders of IRT Property Company:
The Annual Meeting of Shareholders (the "Annual Meeting") of IRT Property
Company, a Georgia corporation (the "Company"), will be held at the Cobb
Galleria Centre, Two Galleria Parkway, Suite 104, Atlanta, Georgia, on
Wednesday, May 31, 1995, at 10:00 a.m. local time, for the following purposes:
1. To elect eight directors to serve until the annual meeting of
shareholders in 1996 or, in the case of each director, until his or her
successor is duly elected and qualified;
2. To vote upon a proposal to amend Article VI of the Articles of
Incorporation to authorize the Company to issue up to 10,000,000 shares of
$1 par value Preferred Stock; and
3. To transact such other business as may properly come before the
Annual Meeting and any adjournments thereof.
Only shareholders of record at the close of business on April 10, 1995 are
entitled to notice of, and to vote at, the Annual Meeting and any adjournments
thereof.
The Company's Proxy Statement and the Annual Report for the fiscal year
ended December 31, 1994 are enclosed.
By Order of the Board of Directors
LEE A. HARRIS
Senior Vice President & Secretary
Atlanta, Georgia
April 14, 1995
YOU ARE URGED TO COMPLETE, SIGN, DATE, AND RETURN YOUR PROXY PROMPTLY IN THE
ENVELOPE PROVIDED SO THAT YOUR SHARES WILL BE VOTED IN ACCORDANCE WITH YOUR
WISHES. RETURNING YOUR PROXY DOES NOT DEPRIVE YOU OF YOUR RIGHT TO ATTEND THE
MEETING AND TO VOTE YOUR SHARES IN PERSON.
<PAGE> 3
IRT PROPERTY COMPANY
200 GALLERIA PARKWAY, SUITE 1400
ATLANTA, GEORGIA 30339
---------------------
PROXY STATEMENT FOR ANNUAL MEETING OF SHAREHOLDERS
MAY 31, 1995 AND ANY ADJOURNMENTS THEREOF
---------------------
APPROXIMATE DATE PROXY MATERIAL FIRST SENT TO SHAREHOLDERS:
APRIL 14, 1995
GENERAL INFORMATION
The enclosed proxy is solicited by the Board of Directors of IRT Property
Company (the "Company") for use at the Annual Meeting of Shareholders (the
"Annual Meeting") of the Company to be held on May 31, 1995 and any adjournments
thereof. The enclosed proxy is revocable at any time before its exercise at the
Annual Meeting by (i) written notice to the Secretary of the Company, (ii)
properly submitting to the Company a duly executed proxy bearing a later date,
or (iii) attending the Annual Meeting and voting in person.
All properly executed proxies delivered pursuant to this solicitation and
not revoked will be voted at the Annual Meeting in accordance with directions
given. Regarding the election of directors to serve until the annual meeting of
shareholders in 1996, in voting by proxy, shareholders may vote in favor of all
nominees or withhold their votes as to all nominees or withhold their votes as
to specific nominees. Regarding the proposal to amend Article VI of the
Company's Articles of Incorporation to authorize the Company to issue up to
10,000,000 shares of $1 par value Preferred Stock, shareholders may vote in
favor of the proposal, against the proposal or may abstain from voting.
Shareholders should specify their choices on the enclosed form of proxy. If no
specific instructions are given regarding the matters to be acted upon, the
shares represented by a signed proxy will be voted "FOR" the election of all
nominees and "FOR" the proposal to amend Article VI of the Articles of
Incorporation to authorize the Company to issue up to 10,000,000 shares of $1
par value Preferred Stock.
The Company has only one class of capital stock, its Common Stock, $1 par
value, of which, as of March 14, 1995, 25,542,391 shares were outstanding. Each
outstanding share of Common Stock is entitled to one vote. Shareholders entitled
to vote or to execute proxies with respect to the Annual Meeting are
shareholders of record at the close of business April 10, 1995.
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SECURITY OWNERSHIP BY CERTAIN BENEFICIAL HOLDERS
The following table sets forth information as of the date indicated with
respect to the only persons who are known by the Company to be the beneficial
owners of more than 5% of the outstanding shares of the Company's Common Stock:
<TABLE>
<CAPTION>
AMOUNT AND NATURE
OF BENEFICIAL PERCENT
NAME AND ADDRESS OF BENEFICIAL OWNER DATE OWNERSHIP OF CLASS
------------------------------------------------ ------- ----------------- --------
<S> <C> <C> <C>
HB Korenvaes Investments, L.P. 2/13/95 3,147,997(1) 11.04%
777 Main Street
Suite 2750
Fort Worth, TX 76102
Franklin Resources, Inc. 2/10/95 1,334,800(2) 5.3%
777 Mariners Island Blvd.
San Mateo, California 94404
</TABLE>
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(1) This information is contained in a Schedule 13G dated February 13, 1995
filed by HB Korenvaes Investments, L.P. with the Securities and Exchange
Commission, a copy of which was received by the Company. Such Schedule 13G
states that (i) at December 31, 1994, the reporting person owned
$35,415,000 face amount of the Company's 7.3% Convertible Subordinated
Debentures due August 15, 2003 which are convertible into 3,147,997 shares
of the Common Stock, $1 par value of the Company and (ii) the reporting
person has sole voting and dispositive power with respect to such 3,147,997
shares.
(2) This information is contained in a Schedule 13G dated February 10, 1995
filed by Franklin Resources, Inc. with the Securities and Exchange
Commission, a copy of which was received by the Company. Such Schedule 13G
states that the reporting person has sole voting and dispositive power with
respect to 1,334,800 shares.
The beneficial ownership of directors and executive officers is set forth
under "ELECTION OF DIRECTORS" below.
ELECTION OF DIRECTORS (PROXY ITEM NO. 1)
The Board of Directors is elected at each annual meeting of shareholders
for a one-year term. Eight incumbent directors have been nominated and have
agreed to serve as directors if elected.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" DONALD W. MACLEOD; MARY M.
THOMAS; HOMER B. GIBBS, JR.; SAMUEL W. KENDRICK; THOMAS H. MCAULEY; BRUCE A.
MORRICE; JAMES H. NOBIL; AND LOUIS P. WOLFORT AS DIRECTORS TO HOLD OFFICE UNTIL
THE ANNUAL MEETING OF SHAREHOLDERS IN 1996 AND UNTIL THEIR SUCCESSORS ARE
ELECTED AND QUALIFIED. THE AFFIRMATIVE VOTE OF THE HOLDERS OF A PLURALITY OF THE
SHARES OF COMMON STOCK CAST AT THE ANNUAL MEETING IS REQUIRED WITH RESPECT TO
THE ELECTION OF THE NOMINEES. ABSTENTIONS AND BROKER NON-VOTES WILL HAVE NO
EFFECT ON THE ELECTION OF DIRECTORS.
CERTAIN INFORMATION CONCERNING NOMINEES AND NAMED EXECUTIVE OFFICERS
The following table sets forth the name and age of each nominee for
election to the Board of Directors of the Company and information as of March
14, 1995 regarding the beneficial ownership of the Company's Common Stock by
each director of the Company, by the Named Executive Officers (as hereinafter
defined),
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<PAGE> 5
and by all directors and executive officers as a group. The amounts shown are
based upon information furnished by the individuals named.
<TABLE>
<CAPTION>
COMPANY SHARES OWNED PERCENTAGE OF
BENEFICIALLY AND OUTSTANDING
NAME CURRENT POSITION WITH NATURE OF BENEFICIAL SHARES OWNED
(DIRECTOR SINCE) AGE COMPANY OWNERSHIP(1) BENEFICIALLY(1)
- --------------------------------- --- ----------------------- -------------------- ---------------
<S> <C> <C> <C> <C>
NOMINEES
Donald W. MacLeod(2) 69 President and Chairman 272,480(6) (9)
(1969)
Mary M. Thomas(2) 48 Director, Executive 63,203(7) (9)
(1994) Vice President, and
Chief Financial
Officer
Homer B. Gibbs, Jr.(2)(4) 63 Director 27,466(7)(8) (9)
(1976)
Samuel W. Kendrick(3)(4) 55 Director 4,180(7) (9)
(1993)
Thomas H. McAuley(3)(4) 49 Director 21,750(7) (9)
(1987)
Bruce A. Morrice(3)(4) 61 Director 14,012(7)(8) (9)
(1986)
James H. Nobil(2)(4) 64 Director 37,925(7)(8) (9)
(1976)(5)
Louis P. Wolfort(2)(4) 78 Director 56,416(7)(8) (9)
(1970)
OTHER NAMED EXECUTIVE OFFICERS
W. Benjamin Jones III 45 Executive Vice 45,915(7) (9)
President
Robert E. Mitzel 46 Executive Vice 40,297(7)(8) (9)
President
ALL DIRECTORS, NOMINEES, AND (10) %
EXECUTIVE OFFICERS
(18 PERSONS) AS A GROUP 700,023 2.71
</TABLE>
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(1) The amounts and percentages of the Company's Common Stock beneficially
owned are reported on the basis of regulations of the Securities and
Exchange Commission governing the determination of beneficial ownership of
securities. The beneficial owner has both voting and investment power over
the shares, unless otherwise indicated.
(2) Member of the Executive Committee.
(3) Member of the Audit Committee.
(4) Member of the Compensation Committee. The Compensation Committee also acts
as the Stock Option Committee.
(5) Date of initial service as a trustee of Summit Properties. Directorship in
the Company commenced on the June 20, 1979 effective date of the merger of
Summit Properties with and into the Company.
(6) This amount includes 62,500 shares which Mr. MacLeod has the right to
acquire pursuant to grants under the Company's Stock Option Plan. This
amount also includes 6,016 shares owned by Mr. MacLeod's wife. Mr. MacLeod
is deemed to be the beneficial owner of such shares under the regulations
of the Securities and Exchange Commission, but he disclaims such beneficial
ownership.
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<PAGE> 6
(7) The number of shares reflected as being owned includes 5,000 shares for Mr.
Nobil; 6,250 shares for Mr. Wolfort; 7,500 shares each for Messrs. Gibbs,
McAuley, and Morrice; 2,500 shares for Mr. Kendrick; 40,875 shares for Ms.
Thomas; 35,605 shares for Mr. Jones; and 31,250 shares for Mr. Mitzel which
each has the right to acquire pursuant to the Company's Stock Option Plan.
(8) The number of shares reflected as being beneficially owned by Mr. Morrice
includes 2,966 shares owned by a marital trust, over which he has no voting
or investment power; and with regard to Messrs. Gibbs, Nobil, Wolfort, and
Mitzel includes 2,500; 30,922; 523; and 392 shares, respectively, owned by
their wives. Messrs. Morrice, Gibbs, Nobil, Wolfort, and Mitzel are deemed
to be beneficial owners of such shares under the regulations of the
Securities and Exchange Commission, but they disclaim such beneficial
ownership.
(9) Less than 1%.
(10) This amount includes 263,655 shares which the Company's executive officers
have the right to acquire and 36,250 shares which the Company's
non-management directors have the right to acquire pursuant to the
Company's Stock Option Plan. Additionally, this amount includes 48,070
shares owned by spouses of the directors and executive officers. The
directors and executive officers are deemed to be the beneficial owners of
such shares under the regulations of the Securities and Exchange
Commission, but they disclaim beneficial ownership in such shares.
COMMITTEES OF THE BOARD OF DIRECTORS; MEETINGS AND COMPENSATION OF DIRECTORS
In accordance with the By-Laws of the Company, the Board of Directors has
established an Executive Committee, an Audit Committee, and a Compensation
Committee (which also serves as a Stock Option Committee). The members of these
Committees are indicated in the preceding section of this Proxy Statement.
The Executive Committee, during the interval between meetings of the Board
of Directors, may exercise the powers of the Board of Directors except with
respect to a limited number of matters which include (i) amending the Articles
of Incorporation or the By-Laws of the Company, (ii) adopting a plan of merger
or consolidation, (iii) the sale, lease, exchange, or other disposition of all
or substantially all the property and assets of the Company, and (iv) a
voluntary dissolution of the Company or a revocation thereof. The Executive
Committee may also serve as a Nominating Committee which serves the limited
purpose of nominating persons to serve as directors of the Company. The full
Board of Directors, however, currently acts as the Nominating Committee and as
such, nominated the eight persons named in the foregoing table. No
recommendations were submitted by shareholders with respect to the nomination of
directors, and the Nominating Committee has no policy with respect to whether or
not it would consider such recommendations by shareholders. The Executive
Committee met once in 1994.
The Audit Committee, composed entirely of outside directors, approves any
transactions involving related parties, recommends to the Board of Directors the
engagement of the independent auditors of the Company, and reviews with the
independent auditors the scope and results of the Company's audits, the
Company's internal accounting controls and the professional services furnished
by the independent auditors to the Company. The Audit Committee met once in
1994.
The Compensation Committee, composed entirely of outside directors,
determines the salary and other compensation to be paid to the executive
officers of the Company. It also acts as the Stock Option Committee and is
responsible for the administration of the Company's Stock Option Plan. The
Compensation Committee met once in 1994.
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<PAGE> 7
During the Company's fiscal year ended December 31, 1994, the Company's
Board of Directors held six meetings. All of the directors attended more than
75% of the aggregate of all meetings of the Board of Directors and the
committees on which they served during 1994.
The Company's policy regarding the compensation of directors is to pay
directors who are not also employees of the Company a retainer fee of $1,000 per
month ($5,000 per annum prior to January 1, 1995); $1,000 plus expenses for each
Board meeting attended; and $500 plus expenses for each Executive Committee,
Audit Committee or Compensation Committee meeting attended. Directors' fees in
1994 aggregated $73,250. In addition, under the Company's 1989 Stock Option
Plan, each non-employee director receives nonqualified stock options to purchase
1,250 shares of the Company's Common Stock upon his or her election and each
annual re-election to the Board.
There is no family relationship between any of the directors and/or
executive officers of the Company.
PRINCIPAL OCCUPATIONS OF NOMINEES FOR ELECTION DURING THE PAST FIVE YEARS
The principal occupations during the past five years of the nominees for
election as directors of the Company are as follows:
Mr. MacLeod has been President and Chairman of the Board of Directors of
the Company since its inception in 1979 and previously served as President and
Managing Trustee of the Company's predecessor, Investors Realty Trust. He is a
director of Abrams Industries, Inc., a real estate development and contracting
company, and a member of the American Institute of Real Estate Appraisers
("M.A.I.").
Ms. Thomas has been Executive Vice President of the Company since May 1991
and Chief Financial Officer of the Company or its predecessor, Investors Realty
Trust, since 1976. She served as Senior Vice President from May 1987 to May 1991
and Vice President from 1981 to 1987.
Mr. Gibbs is currently occupied in the management of private investments.
He retired as Vice Chairman of Mid-South Financial Corporation, a Nashville,
Tennessee mortgage banking firm, on January 1, 1994, a position he held since
1986. He was President of Gibbs and Company, a Nashville, Tennessee mortgage
banking firm, from 1965 through 1986.
Mr. Kendrick has been President of Ruddick Investment Company ("Ruddick")
since November 1994. Ruddick, an affiliate of Harris Teeter, Inc. ("Harris
Teeter"), is involved in real estate development and venture capital investment.
Mr. Kendrick served as Executive Vice President of Harris Teeter, a 140-store
supermarket chain with principal executive offices in Charlotte, North Carolina,
from July 1992 to October 1994. He was Senior Vice President/Finance and
Administration for Harris Teeter from October 1989 to 1992, Vice President/Real
Estate and Construction from February 1986 to 1989, and Vice President/ Real
Estate from February 1984 to 1986. Mr. Kendrick currently serves as a director
of Ruddick and Harris Teeter.
Mr. McAuley has served as Chairman of the Executive Committee of the
Company since 1990 and regional partner of Faison Associates, Inc. ("Faison"), a
real estate development and management company headquartered in Charlotte, North
Carolina, since May 1993. From June 1988 to May 1993, he served as Chairman and
Chief Executive Officer and part owner of Ewing Southeast Realty, Inc.
("Ewing"), an Atlanta, Georgia real estate company. Faison purchased Ewing on
May 1, 1993, the date Mr. McAuley became a Faison partner. Prior to 1988, Mr.
McAuley held various senior management positions, including serving as President
and a director of Ewing and Johnstown Mortgage Company, an Atlanta mortgage
banking company.
5
<PAGE> 8
Mr. Morrice is Managing Director of Morrice Financial Corp., a Dallas,
Texas real estate finance and investment firm. He was President of Lion Service
Corp., a Dallas, Texas service corporation of Federated Savings and Loan,
engaged in the origination and servicing of loans and real estate investment
mortgage banking, from 1983 to 1987. He was President of Morrice Financial Corp.
from 1977 until 1985.
Mr. Nobil is President of JLJ Realty, Inc., a Florida property management
firm. From 1987 through 1990, he was President of TMI Realty, Inc., a Florida
property management firm. He also served as President of another Florida
property management firm from December 1990 to March 1991. Mr. Nobil has been
the managing joint venture partner in Kokomo Mall Associates, an Indiana Joint
Venture, since August 1986. On April 5, 1991, Kokomo Mall Associates filed a
petition for relief under Chapter 11 of the United States Bankruptcy Code, 11
U.S.C. sections 101 et seq. On June 30, 1992, the Bankruptcy Court entered an
order dismissing the Chapter 11 proceeding filed by Kokomo Mall Associates based
upon its finding that all payments to creditors had been made. Mr. Nobil is the
President and 30% owner of Pearl Britain, Inc., a Florida corporation. Pearl
Britain, Inc. is a general partner of Pearl Britain Associates, Ltd., a Florida
limited partnership. On September 21, 1992, the Circuit Court for the Fifth
Judicial Circuit in and for Marion County, Florida, appointed a receiver for
Pearl Britain Plaza, a shopping center located in Ocala, Florida, which center
is owned by Pearl Britain Associates, Ltd. The receivership terminated when, on
March 11, 1993, Pittsburgh National Bank acquired this property by foreclosure.
Mr. Nobil was a Trustee and Chairman of Summit Properties from 1976 until its
merger into the Company in June 1979.
Mr. Wolfort is retired and currently occupied as a private investor. From
1986 to January 1991, he was Chairman of the Board of Mortgage Co-op, Inc., a
New Orleans, Louisiana mortgage banking firm. From 1984 through 1986, he was a
director of and a consultant to First National Mortgage Corporation, a New
Orleans, Louisiana mortgage banking firm, and Meritor Mortgage Corporation, a
Philadelphia, Pennsylvania mortgage banking firm, both of which are subsidiaries
of Philadelphia Savings Fund Society of Philadelphia, Pennsylvania. He was
Chairman of the Board of First National Mortgage Corporation from 1960 to
January 1984.
EXECUTIVE OFFICERS
In addition to Donald W. MacLeod, President, and Mary M. Thomas, Executive
Vice President and Chief Financial Officer, the executive officers of the
Company are as follows:
Mr. W. Benjamin Jones III has been Executive Vice President of the Company
since May 1994. He served as Senior Vice President from May 1987 to May 1994 and
Secretary of the Company or its predecessor, Investors Realty Trust, from 1977
to May 1992, and Vice President from 1981 to 1987.
Mr. Robert E. Mitzel has been Executive Vice President of the Company since
May 1994. He served as Senior Vice President from May 1991 to May 1994 and Vice
President from January 1988 to May 1991.
Mr. Lee A. Harris, age 36, has been Senior Vice President of the Company
since August 1992 and Secretary of the Company since May 1992. He served as Vice
President from May 1989 to August 1992 and Assistant Secretary from May 1987 to
May 1992. He was Assistant Vice President from 1988 to May 1989.
Mr. James G. Levy, age 36, was employed by the Company in June 1994 as Vice
President and Treasurer. He served as Regional Controller for Faison from May
1993 to May 1994 and Chief Financial Officer of Ewing from July 1991 until May
1993. He was with Arthur Andersen & Co., the Company's present accounting firm,
from January 1987 to June 1991.
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<PAGE> 9
Ms. Donna H. Dixon, age 30, has been Vice President of the Company since
August 1992 and Assistant Treasurer since May 1992. She was a consultant with
Metropolitan Life Insurance Company from September 1991 to March 1992. She was
an auditor with Arthur Andersen & Co. from December 1987 to September 1991.
Ms. Rosemary C. Beck, age 40, has been Vice President of the Company since
August 1992. She served as Assistant Vice President from May 1990 to August 1992
and has been employed by the Company since July 1987.
Ms. Nanette B. Cook, age 38, has been Vice President of the Company since
August 1992. She served as Controller of The Sofran Company, an Atlanta, Georgia
real estate company specializing in the development and management of
neighborhood and community shopping centers, from 1988 to 1992.
Mr. E. Denton Williams III, age 62, was employed by the Company in February
1993 to oversee retail acquisitions and elected Vice President in May 1993. He
served as associate broker for O'Brien Realty, a Lexington Park, Maryland
residential and commercial real estate company, from 1991 to 1993. From 1987 to
1990 he served as Vice President of Home Federal Savings Bank in Washington,
D.C.
Mr. William E. Novick, age 39, was employed by the Company in June 1994 as
Vice President and Director of Leasing. From May 1991 to May 1994, he served as
Senior Vice President of JLJ Realty, Inc. From August 1982 to April 1991, he was
employed by TMI Realty, Inc., serving in various management positions, including
Senior Vice President from 1990 to April 1991.
Mr. Daniel F. Lovett, age 48, was employed by the Company in October 1994
as Vice President and Director of Construction to oversee redevelopment and
expansion activities. From 1979 to September 1994, he was with Southeast
Shopping Centers Corp., a South Florida neighborhood and community shopping
center developer, serving as Vice President and Director of Development.
The executive officers are elected by and serve at the pleasure of the
Board of Directors.
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Overview and Philosophy
The Compensation Committee, composed entirely of outside directors,
determines the salary and other compensation to be paid to the executive
officers of the Company. The Compensation Committee typically reviews the salary
of each executive officer once each year at its November Board meeting. At that
meeting, the Compensation Committee acting as a Stock Option Committee also
usually determines the individuals to whom incentive stock options are to be
awarded and the number of shares for which options are to be granted.
The Company's executive compensation program has three primary objectives:
* Reward executives for long-term management focus and the enhancement
of shareholder value.
* Attract and retain key executives critical to the long-term success
of the Company.
* Support the achievement of desired Company performance.
In determining the compensation to be paid to the executive officers of the
Company, the Compensation Committee considers compensation paid to other
executives performing similar jobs within the industry. Some
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<PAGE> 10
of the companies considered by the Compensation Committee are included in the
NAREIT All REIT Index included in the Comparative Stock Performance section of
this Proxy Statement. In addition, the members of the Compensation Committee
rely upon their own knowledge of compensation paid to executives of companies of
comparable size and complexity. In these comparisons the Compensation Committee
strives to fix the compensation of the Company's executive officers in the
middle of the class of comparable companies. The members also consider the
performance of the Company and the merits of the individual under consideration.
The members will use their discretion to set executive compensation where in
their judgment external, internal or an individual's circumstances warrant it.
Executive Officer Compensation Program
The Company's executive officer compensation program is comprised of base
salary, year-end additional cash compensation, long-term incentive compensation
in the form of stock options, and various benefits, including medical and life
insurance generally available to all employees of the Company.
Base Salary
The Chairman and President recommends to the Compensation Committee the
base salary levels for the Company's executive officers (other than the Chairman
and President) based on his evaluation of individual experience and performance
and in his subjective discretion on the overall operating performance of the
Company. Base salary levels are then set in the discretion of the Compensation
Committee after consideration of the foregoing recommendations. The Compensation
Committee members also have access to salary levels of executive officers of
other companies within the industry which they may consult.
Year-End Additional Cash Compensation and Certain Employment Agreements
During 1980 the Board of Directors approved and adopted a pension program
for the employees of the Company. The program included a noncontributory pension
plan for all employees of the Company, under which the Company accrued and
funded pension costs each year equal to 12% of employees' annual base salaries,
and each employee became "vested" with respect to his or her accumulated pension
account at the rate of 20% per year, with full "vesting" upon completion of five
years of service with the Company. Effective June 30, 1990, the Board of
Directors elected to terminate the pension plan.
Upon termination of the pension plan, the Board of Directors determined
that it would be appropriate to substitute in lieu thereof a program of year-end
cash payments to the executive officers of the Company and certain other
corporate employees of the Company selected in the discretion of the Chairman
and President. This program was instituted in 1990. Under this program,
participants receive a year-end cash payment from the Company, the amount of
which is based upon each participant's length of service with the Company. Each
participant who has been employed by the Company for more than five years will
receive a year-end cash payment equal to 12% of his or her salary. Each
participant with less than five years will receive year-end cash payments in
graduated amounts designed to produce a cumulative 12% payment after completion
of five years of service. The Company paid or accrued approximately $168,000,
$154,000, and $99,000 under this program in 1994, 1993, and 1992, respectively.
The Company, in 1980, in conjunction with the adoption of the
noncontributory pension plan, agreed to provide deferred compensation to Mr.
MacLeod and Ms. Thomas upon their retirement in recognition of their time in
service with the Company, which had been significantly longer than that of the
remaining employees. Based upon the assumption that Ms. Thomas will continue in
the employ of the Company until retirement, it
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<PAGE> 11
is expected that her agreement with the Company will not add to any benefits
otherwise payable to her under the Company's Year-End Additional Cash
Compensation Program as described above. In the case of Mr. MacLeod, the Company
has agreed to annually accrue deferred compensation allocable to him for each of
the 15 years beginning in 1980 in amounts ranging from approximately $6,000 in
1980 to approximately $22,000 in 1994. Benefits payable to Mr. MacLeod under
this agreement (the "Employment Agreement") vary depending upon the reason and
timing of the termination of his employment. If his employment is terminated
after Mr. MacLeod has reached age 70, the Company has agreed to pay him deferred
compensation of approximately $29,000 per year. If Mr. MacLeod voluntarily
leaves the employ of the Company between ages 65 and 69 inclusive, his annual
compensation under this Employment Agreement would increase from approximately
$13,000 at age 65 to approximately $25,000 at age 69. Termination due to death
or disability at any time will entitle Mr. MacLeod or his beneficiary to the
cumulative total accrual in his deferred compensation account at the December
31st next preceding the date of his death or disability.
The Company currently has no other postretirement or postemployment
benefits.
Stock Option Program
Long-term incentives are provided through the Company's 1989 Stock Option
Plan (the "Plan"). The purpose of the Plan is to promote the long-term success
of the Company by providing financial incentives to the directors, officers, and
key employees of the Company who are in positions to make significant
contributions toward the success of the Company.
Options granted under the Plan may be either incentive stock options
(options that meet certain requirements of the Internal Revenue Code, thereby
receiving special tax treatment) or nonqualified stock options (options to
purchase company stock that do not meet the special requirements for incentive
stock options). Incentive stock options ("ISOs") may be granted only to persons
who are employees of the Company, including members of the Board of Directors
who are also employees of the Company. Nonqualified stock options may also be
granted to officers and employees of the Company.
The Plan is currently administered by the Compensation Committee. Subject
to the approval of the Board of Directors, the Compensation Committee has the
authority to determine the individuals to whom stock options are awarded, the
number of shares for which options are granted (the aggregate fair market value
of stock with respect to which ISOs are exercisable for the first time by any
individual during any calendar year shall not, however, exceed $100,000, and no
person shall be eligible to receive an ISO for shares in excess of such
limitation), and the determination of whether an option shall be an incentive
stock option or a nonqualified stock option. In addition, the Plan provides for
the automatic grant of nonqualified options to purchase 1,250 shares of the
Company's Common Stock to each non-employee director upon his or her election
and each annual re-election to the Board.
Options granted under the Plan are exercisable no later than ten years from
the date of grant with the exercise price being equal to 100% of the market
value on the date of grant. The 1989 Plan replaced the Key Employee Stock Option
Plan adopted in 1983, as amended by the Board of Directors on February 9, 1987
(the "1983 Plan"). No further options or Stock Appreciation Rights ("SARs") may
be granted under the 1983 Plan, although unexercised options previously granted
under the 1983 Plan remain in full force and effect. The 1989 Plan does not
provide for SARs.
In determining the grants of stock options to officers and key employees of
the Company, including the executive officers other than the Chairman and
President, the Compensation Committee reviewed with the Chairman and President
the recommended individual awards, based on the respective performance,
responsi-
9
<PAGE> 12
bilities, and contributions of each of the individuals under consideration, and
the operating performance of the Company. The Compensation Committee also
considered the expected performance requirements and contributions, as well as
the position level, of each of these individuals. The Chairman and President and
the Compensation Committee did not give consideration to current holdings of the
Common Stock or options to purchase the Common Stock of the Company when making
their decision regarding option awards.
Compensation to Chairman and President
Mr. MacLeod has been President and Chairman of the Board of Directors of
the Company since its inception in 1979. He previously served as President and
Managing Trustee of Investors Realty Trust, the predecessor of the Company,
founded in 1969.
Mr. MacLeod's base salary for fiscal year 1994 was $279,170, as compared to
$250,000 for fiscal year 1993 and $240,000 for fiscal year 1992. Under the
Company's program of year-end cash payments, Mr. MacLeod also received $33,500
in additional cash compensation for fiscal year 1994 compared to $30,000 for
fiscal year 1993 and $28,800 for fiscal year 1992. Although Mr. MacLeod received
no compensation during these years under his Employment Agreement, the Company
accrued $22,571, $20,613, and $18,824 during fiscal years 1994, 1993, and 1992,
respectively, for payments that will be made after his retirement. Mr. MacLeod
also was awarded, during fiscal years 1994, 1993, and 1992, incentive stock
options to purchase 8,000, 8,000, and 10,000 shares of the Company's Common
Stock, respectively.
The Compensation Committee considered Mr. MacLeod's dual role as both
Chairman and President and the salaries and benefits of other Chief Executive
Officers for similar companies within the industry in determining his cash
compensation. The award of stock options to the Chairman and President was made
separately and was based, among other things, on competitive practice within the
industry, the Committee's perception of his past and expected contributions to
the Company's long-term performance, and the $100,000 ISO limitation as
described above.
Section 162(m) of the Internal Revenue Code (the "Code") adopted as part of
the Revenue Reconciliation Act of 1993, generally limits to $1 million the
deduction that can be claimed by any publicly-held corporation for compensation
paid to any "covered employee" in any taxable year beginning after December 31,
1993. The term "covered employee" for this purpose is defined generally as the
Chairman and President and the four other highest paid employees of the Company.
Performance-based compensation is outside the scope of the $1 million limitation
and, hence, generally can be deducted by a publicly-held corporation without
regard to amount, provided that, among other requirements, such compensation is
approved by the shareholders. The Compensation Committee has not and does not
anticipate the need to develop a formal policy on this matter since the
compensation of the Company's executive officers is clearly outside the scope of
the limitations of Section 162(m).
COMPENSATION COMMITTEE
Samuel W. Kendrick, Chairman
Homer B. Gibbs, Jr.
Thomas H. McAuley
Bruce A. Morrice
James H. Nobil
Louis P. Wolfort
10
<PAGE> 13
SUMMARY COMPENSATION TABLE
The following table shows the compensation for the past three years of the
President and each of the Company's executive officers with salary and bonus of
over $100,000 for fiscal 1994 (the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
ANNUAL COMPENSATION ------------
------------------------------------- SECURITIES
OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS(1) COMPENSATION(2) OPTIONS(#) COMPENSATION(3)
- ---------------------------- ---- -------- -------- --------------- ------------ ---------------
<S> <C> <C> <C> <C> <C> <C>
Donald W. MacLeod 1994 $279,170 $ -- $33,500 8,000 $22,571
Chairman of the Board and 1993 250,000 -- 30,000 8,000 20,613
President 1992 240,000 -- 28,800 10,000 18,824
Mary M. Thomas 1994 137,500 -- 16,500 6,000 --
Executive Vice President 1993 120,000 -- 14,400 6,000 --
and Chief Financial 1992 99,000 4,000 11,880 6,000 --
Officer
W. Benjamin Jones III 1994 114,583 -- 13,750 6,000 --
Executive Vice President 1993 100,000 -- 12,000 6,000 --
1992 91,500 4,000 10,980 6,000 --
Robert E. Mitzel 1994 104,167 520 12,500 6,000 --
Executive Vice President 1993 75,000 699 9,000 6,000 --
1992 67,000 12,202 8,040 6,000 --
</TABLE>
- ---------------
(1) Prior to August 1992, the Company had a bonus plan under which certain
employees could share in the success of the Company in leasing vacant
space. The total amount paid under this plan each year was based on the
present value of 3% of the net rental stream over the initial terms of
leases generated by Company employees. Payments made to each of Ms. Thomas
and Mr. Jones in 1992 represented 4.76% of the total bonuses paid under
this plan and to Mr. Mitzel represented 14.29% of the total bonuses paid.
The Company restructured its leasing and property management division in
August 1992 and discontinued this bonus plan. From August 1992 through May
1994, Mr. Mitzel received certain leasing commissions based on the
performance of leasing agents for certain properties. Mr. Mitzel's
entitlement to such commissions ceased June 1, 1994.
(2) Year-End Additional Cash Compensation in lieu of pension.
(3) Amounts accrued by the Company during fiscal years 1994, 1993 and 1992 under
Mr. MacLeod's Employment Agreement for amounts payable to him after
retirement.
11
<PAGE> 14
STOCK OPTION PLAN
The following table sets forth (i) all individual grants of stock options
made by the Company during fiscal 1994 to each of the Named Executive Officers
(all of which are incentive stock options granted under the Plan and exercisable
immediately upon grant), (ii) the ratio that the number of options granted to
each individual bears to the total number of options granted to all employees of
the Company, (iii) the exercise price and expiration date of these options, and
(iv) estimated potential realizable values assuming the stock price appreciates
over a ten-year term at rates of 5% and 10% compounded annually.
OPTION GRANTS IN FISCAL 1994
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED
--------------------------------------- ANNUAL RATES OF
% OF TOTAL STOCK
NUMBER OF OPTIONS PRICE APPRECIATION
SECURITIES GRANTED TO EXERCISE FOR
UNDERLYING EMPLOYEES OR BASE OPTION TERM
OPTIONS IN FISCAL PRICE EXPIRATION --------------------
NAME GRANTED (#) 1994 ($/SH) DATE 5% 10%
- ------------------------ ----------- ---------- -------- ---------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Donald W. MacLeod 8,000 12.12% $10.75 1/2/04 $54,085 $137,062
Mary M. Thomas 6,000 9.09 10.75 1/2/04 40,564 102,796
W. Benjamin Jones III 6,000 9.09 10.75 1/2/04 40,564 102,796
Robert E. Mitzel 6,000 9.09 10.75 1/2/04 40,564 102,796
</TABLE>
The following table sets forth (i) the number of shares received and the
aggregate dollar value realized in connection with each exercise of outstanding
stock options during fiscal 1994 by each of the Named Executive Officers, (ii)
the total number and value of all outstanding, unexercised options (all of which
are exercisable) held by the Named Executive Officers as of the end of fiscal
1994, and (iii) the aggregate dollar value of all such unexercised options that
are in-the-money; that is, when the fair market value of the common stock that
is subject to the option exceeds the exercise price of the option.
AGGREGATED OPTION EXERCISES IN FISCAL 1994
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
VALUE OF
NUMBER OF NUMBER OF UNEXERCISED
SHARES UNEXERCISED IN-THE-MONEY
ACQUIRED ON VALUE OPTIONS AT OPTIONS AT
NAME EXERCISE REALIZED 12/31/94 12/31/94(1)
- ------------------------------------ ----------- -------- ----------- ------------
<S> <C> <C> <C> <C>
Donald W. MacLeod -- -- 53,000 $ 10,000
Mary M. Thomas -- -- 33,375 21,750
W. Benjamin Jones III 5,810 $6,390 28,105 4,171
Robert E. Mitzel -- -- 23,750 6,000
</TABLE>
- ---------------
(1) Value based on market value of the Company's Common Stock at the date of
exercise or the end of fiscal 1994 minus the exercise price.
12
<PAGE> 15
COMPARATIVE STOCK PERFORMANCE
The line graph below compares the cumulative total shareholder return on
Common Stock of the Company for the last five fiscal years with the cumulative
total return on the NAREIT All REIT Total Return Index and the S&P 500 Index
over the same period. This comparison assumes that the value of the investment
in the Company Common Stock and each index was $100 on December 31, 1989 and
that all dividends were reinvested.
(GRAPH)
<TABLE>
<CAPTION>
NAREIT ALL
REIT Total
Measurement Period IRT Property Return S&P 500
(Fiscal Year Covered) Company Index(1) Index
<S> <C> <C> <C>
12/31/89 100 100 100
12/31/90 68 83 97
12/31/91 92 112 126
12/31/92 128 126 136
12/31/93 120 149 150
12/31/94 125 150 152
</TABLE>
- ---------------
(1) The NAREIT All REIT Total Return Index is maintained by the National
Association of Real Estate Investment Trusts. It contained 223
tax-qualified REITs with a total market capitalization of $44.3 billion as
of December 31, 1994.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company's Board of Directors, excluding Mr. MacLeod and Ms. Thomas,
serves as its Compensation Committee. There are no "interlocks" as defined by
the Securities and Exchange Commission with respect to any member of the
Compensation Committee.
Beginning in 1990, the Company entered into an arrangement with Mr.
McAuley, whereby Mr. McAuley provided real estate consulting services to the
Company. Pursuant to this arrangement, the Company paid
13
<PAGE> 16
Mr. McAuley $2,000 for these services during 1994. By mutual agreement of Mr.
McAuley and the Company, this arrangement was terminated effective March 1,
1994.
EMPLOYMENT AGREEMENTS
Mr. MacLeod, Chairman and President of the Company, and Ms. Thomas,
Executive Vice President and Chief Financial Officer, each entered into
Employment Agreements with the Company in July 1980 (the "Employment
Agreements"). The Employment Agreements continue until terminated by either
party on at least 90 days prior written notice. The Employment Agreements
established that the base salary for Mr. MacLeod and Ms. Thomas would not be
less than $90,000 or $35,000, respectively, with the annual base salary
determined in the discretion of the Board of Directors. In addition, the
Employment Agreements provided for deferred compensation for each of Mr. MacLeod
and Ms. Thomas which has been more fully described under "-- Compensation
Committee Report on Executive Compensation" and "-- Summary Compensation Table."
PROPOSAL TO AMEND THE COMPANY'S ARTICLES OF INCORPORATION (PROXY ITEM NO. 2)
GENERAL
At its meeting on March 3, 1995, the Board of Directors of the Company
unanimously adopted a resolution approving an amendment to Article VI of the
Company's Articles of Incorporation, as amended (the "Articles"), and
recommending that such amendment be submitted to the shareholders for approval
and adoption. The amendment to Article VI of the Articles would authorize the
Company to issue up to 10,000,000 shares of $1 par value Preferred Stock in such
series and with such rights as the Board of Directors may deem appropriate.
DESCRIPTION
The proposed amendment to Article VI of the Articles authorizes the Company
to issue up to 10,000,000 shares of $1 par value Preferred Stock. If this
amendment is approved, the Board of Directors would be empowered, without the
necessity of further action or authorization by the Company's shareholders
(unless required in a specific case by applicable laws or regulations or stock
exchange rules), to authorize the issuance of the Preferred Stock from time to
time in one or more series, and to fix by resolution or resolutions the voting
powers, designations, preferences, rights, qualifications, limitations and
restrictions of each series. Each series of Preferred Stock could, as determined
by the Board of Directors at the time of issuance, rank senior to the Company's
Common Stock with respect to dividends and redemption and liquidation rights. No
preferred stock is presently authorized by the Articles.
The amendment would authorize the Board of Directors to determine, among
other things, with respect to each series of Preferred Stock which may be
issued: (a) the number of shares constituting such series; (b) the dividend
rates, conditions and preferences, if any; (c) whether dividends would be
cumulative and, if so, the date from which dividends on the series would
accumulate; (d) whether, and upon what terms, the series would be convertible or
redeemable; (f) the preference, if any, to which the series would be entitled in
the event of voluntary or involuntary liquidation of the Company; (g) whether a
sinking fund would be provided for the redemption of the series and, if so, the
terms and conditions thereof; and (h) whether the holders of such securities
would have voting powers and the extent of those powers. In connection with (d)
above, the New York Stock Exchange, on which the Company's Common Stock is
listed, requires shareholder approval under certain circumstances for the
issuance of preferred stock convertible into a number
14
<PAGE> 17
of shares of common stock equal to 20% or more of the outstanding shares of
common stock before giving effect to such conversion.
Holders of Common Stock have no preemptive right to purchase or otherwise
acquire any Preferred Stock that may be issued in the future. The proposed
amendment would not change the number of shares of Common Stock currently
authorized (75,000,000 shares), of which 25,542,391 shares were outstanding on
March 14, 1995.
The amendment also reaffirms the Company's power to issue authorized stock
of any class or series, any securities convertible into or exchangeable for such
stock, and any options, rights or warrants to purchase or acquire such shares.
The text of the revised Article VI which incorporates this proposed
amendment is set forth in Exhibit A attached hereto. If adopted by the
shareholders, this revision will replace the current Article VI in its entirety.
REASONS FOR AND POSSIBLE EFFECTS OF THE PROPOSED AMENDMENT
The Board of Directors recommends the authorization of Preferred Stock to
increase the Company's financial flexibility. The Board believes that the
complexity of modern business financing and acquisition transactions requires
greater flexibility in the Company's capital structure than now exists. The
Preferred Stock would be available for issuance from time to time as determined
by the Board for any proper corporate purpose. Such purposes might include,
without limitation, issuance in public or private sales for cash as a means of
obtaining capital for use in the Company's business and operations and issuance
as part or all of the consideration required to be paid by the Company for
acquisitions of other businesses or properties. The Company does not, at
present, have any agreements, understandings or arrangements which would result
in the issuance of any Preferred Stock.
It is not possible to state the actual effect of the authorization of the
Preferred Stock upon the rights of holders of Common Stock until the Board
determines the respective rights of the holders of one or more series of the
Preferred Stock. However, such effects might include: (a) reduction of the
amount otherwise available for payment of dividends on Common Stock, to the
extent dividends are payable on any issued shares of Preferred Stock, and
restrictions on dividends on Common Stock if dividends on the Preferred Stock
are in arrears; (b) dilution of the voting power of the Common Stock to the
extent that the Preferred Stock has voting rights or is convertible into Common
Stock; and (c) holders of Common Stock not being entitled to share in the
Company's assets upon liquidation until satisfaction of any liquidation
preference granted to the Preferred Stock.
The amendment to Article VI may be viewed as having the effect of
discouraging an unsolicited attempt by another person or entity to acquire
control of the Company. Issuances of authorized preferred shares can be
implemented, and have been implemented by some companies in recent years, with
voting or conversion privileges intended to make acquisition of the company more
difficult or more costly. Such an issuance could discourage or limit the
shareholders' participation in certain types of transactions that might be
proposed (such as a tender offer), whether or not such transactions were favored
by the majority of the shareholders. In addition, private placement of preferred
shares with persons sympathetic to present management could make removal of
incumbent management more difficult.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THIS PROPOSED AMENDMENT TO
ARTICLE VI OF THE COMPANY'S ARTICLES OF INCORPORATION, AS AMENDED. THE
AFFIRMATIVE VOTE OF THE HOLDERS OF A MAJORITY OF THE
15
<PAGE> 18
COMPANY'S OUTSTANDING SHARES OF COMMON STOCK IS REQUIRED FOR THE APPROVAL OF
THIS PROPOSED AMENDMENT. ABSTENTIONS AND BROKER NON-VOTES WILL HAVE THE SAME
EFFECT AS A VOTE "AGAINST" THE PROPOSED AMENDMENT.
EXISTING ANTI-TAKEOVER PROVISIONS
In addition to the proposed amendment to the Articles contained herein,
existing provisions of the Articles could deter, to varying degrees and in
various circumstances, an effort to take control of the Company without the
approval of the Board of Directors. Those provisions are summarized below. The
summary is qualified in its entirety by reference to the particular provisions.
REIT Qualification Provisions. The Articles contain provisions restricting
transfer of shares ("Shares") of the Company's capital stock, and authorizing
the directors to call Shares for purchase as appropriate to maintain the
Company's qualification as a REIT under the Internal Revenue Code of 1986 (the
"Code"). Among the requirements for REIT qualification, the Company must have at
least 100 shareholders, and five or fewer individuals may not own directly or
indirectly 50% or more of the outstanding Shares. In addition, 95% of the
Company's gross annual income must come from qualifying sources, including
principally "rents from real property" with the Code specifically excluding from
the definition of such term any rents received from any tenant which itself
owns, or which is more than 10% owned by any individual who owns, more than 10%
of the Shares. The Articles authorize the directors to refuse to transfer Shares
and to call for the purchase of Shares so as to prevent concentrations of
ownership potentially disqualifying the Company as a REIT or potentially
disqualifying income as "rents from real property." The Articles also void any
purported transfer of Shares which would result in ownership by less than 100
shareholders, or would result in five or fewer individuals directly or
indirectly owning more than 50% of the Company, or would result in any tenant or
10% or more owner of a tenant owning more than 10% of the Company; and further
provide that the purported transferee of any such Shares shall be deemed never
to have had an interest therein or alternatively shall be deemed to have
acquired and to be holding such Shares for and on behalf of the Company. Any
call for purchase of any Shares pursuant to the aforesaid provisions of the
Articles would most likely be from one or more holders of significant blocks
whose concentrated ownership is considered by the directors to threaten the
Company's REIT status.
No Preemptive Rights. Holders of the capital stock of the Company do not
have preemptive rights.
Available Capital Stock. The Company had 49,457,609 shares of authorized
but unissued Common Stock as of March 14, 1995. Such authorized and unissued
stock could be used by the Board for defensive purposes, including its issuance
to third parties or use in recapitalization transactions.
16
<PAGE> 19
INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen & Co. has been appointed by the Board of Directors as the
independent public accountants for the Company for 1995. It has served as the
independent public accountants for the Company since 1979.
Representatives of the firm of Arthur Andersen & Co. will be present at the
Annual Meeting with the opportunity to make a statement if they desire to do so
and will be available to answer questions concerning the financial affairs of
the Company.
EXPENSES OF SOLICITATION
The cost of soliciting proxies will be borne by the Company. In addition to
solicitations by mail, officers, directors, and regular employees of the Company
may solicit proxies personally or by telephone, telegraph or other means without
additional compensation. The Company will reimburse brokers, fiduciaries, and
custodians for their costs in forwarding proxy materials to beneficial owners of
Common Stock held in their names.
SHAREHOLDERS' PROPOSALS
Proposals of shareholders intended to be presented at the 1996 annual
meeting of shareholders must be received at the Company's principal executive
offices on or before December 16, 1995 to be eligible for inclusion in the
Company's proxy statement and proxy relating to that meeting.
OTHER MATTERS
The management of the Company does not know of any matters to be presented
at the meeting other than those mentioned in this Proxy Statement.
The management of the Company urges you to attend the Annual Meeting and to
vote your shares in person. Whether or not you plan to attend, please sign and
promptly return your proxy. Your proxy may be revoked at any time before it is
voted. Such proxy, if executed and returned, gives discretionary authority with
respect to any other matters that may come before the meeting.
IRT PROPERTY COMPANY
By: LEE A. HARRIS
Senior Vice President & Secretary
17
<PAGE> 20
EXHIBIT A
ARTICLE VI
AUTHORIZED SHARES
A. The total number of shares of capital stock which the Corporation shall
have authority to issue is 85,000,000, of which 75,000,000 shall be Common Stock
of the par value of $1 per share (hereinafter called the "Common Stock") and
10,000,000 shall be Preferred Stock of the par value of $1 per share
(hereinafter called the "Preferred Stock").
B. The Preferred Stock may be issued from time to time by the Corporation
in one or more series, with such voting powers, full or limited, or no voting
powers, and such designations, preferences and relative, participating, optional
or other special rights, and qualifications, limitations or restrictions
thereof, as shall be stated and expressed in the resolution or resolutions
providing for the issuance of such stock adopted by the Board of Directors of
the Corporation pursuant to authority to do so which is hereby vested in the
Board of Directors. Each such series of Preferred Stock shall be distinctly
designated. Except in respect of the particulars fixed by the Board of Directors
for each series as permitted hereby, all shares of Preferred Stock so designated
by the Board of Directors shall be alike in every particular, except that shares
of any one series issued at different times may differ as to the dates from
which dividends thereon shall be cumulative. The voting rights, if any, of each
such series and the preferences and relative, participating, optional and other
special rights of each such series and the qualifications, limitations and
restrictions thereof, if any, may differ from those of any and all other series
at any time outstanding; and the Board of Directors of the Corporation is hereby
expressly granted authority to fix, by resolutions duly adopted prior to the
issuance of any shares of a particular series of Preferred Stock so designated
by the Board of Directors, the voting powers of stock of such series, if any,
and the designations, preferences and relative, participating, optional and
other special rights and the qualifications, limitations and restrictions
thereof, if any, for such series, including without limitation the following:
(1) The distinctive designation of and the number of shares of
Preferred Stock which shall constitute such series; provided that such
number may be increased (except where otherwise provided by the Board of
Directors) or decreased (but not below the number of shares thereof then
outstanding) from time to time by like action of the Board of Directors;
(2) The rate and time at which, and the terms and conditions upon
which, dividends, if any, on Preferred Stock of such series shall be paid,
the extent of the preference or relation, if any, of such dividends to the
dividends payable on any other series of Preferred Stock or any other class
of stock of the Corporation and whether such dividends shall be cumulative
or non-cumulative.
(3) The right, if any, of the holders of Preferred Stock of such
series to convert the same into, or exchange the same for, shares of any
other class of stock or any series of any class of stock of the Corporation
and the terms and conditions of such conversion or exchange;
(4) Whether or not Preferred Stock of such series shall be subject to
redemption, and the redemption price or prices and the time or times at
which, and the terms and conditions upon which, Preferred Stock of such
series may be redeemed;
(5) The rights, if any, of the holders of Preferred Stock of such
series upon the voluntary or involuntary liquidation of the Corporation;
18
<PAGE> 21
(6) The terms of the sinking fund or redemption or purchase account,
if any, to be provided for the Preferred Stock of such series; and
(7) The voting powers, if any, of the holders of such series of
Preferred Stock which may, without limiting the generality of the
foregoing, include the right, voting as a series by itself or together with
any other series of the Preferred Stock as a class, (i) to vote more or
less than one vote per share on any or all matters voted upon by the
shareholders and (ii) to elect one or more directors of the Corporation if
there has been a default in the payment of dividends on any one or more
series of the Preferred Stock or under other circumstances and upon such
other conditions as the Board of Directors may fix.
C. Except as otherwise provided herein, the Board of Directors shall have
authority to authorize the issuance, from time to time, without any vote or
other action by the shareholders, of any or all shares of stock of the
Corporation of any class or series at any time authorized, and any securities
convertible into or exchangeable for any such shares, and any options, rights or
warrants to purchase or acquire any such shares, in each case to such persons
and on such terms (including as a dividend or distribution on or with respect
to, or in connection with a split or combination of, the outstanding shares of
stock of the same or any other class or series) as the Board of Directors from
time to time in its discretion lawfully may determine; provided, that the
consideration for the issuance of shares of stock of the Corporation (unless
issued as such a dividend or distribution or in connection with such a split or
combination) shall not be less than the par value of such shares. Shares so
issued shall be fully paid stock, and the holders of such stock shall not be
liable to any further call or assessments thereon.
19
<PAGE> 22
APPENDIX A
IRT PROPERTY COMPANY
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
SOLICITED BY THE BOARD OF DIRECTORS
The undersigned hereby appoints DONALD W. MACLEOD and LEE A. HARRIS, as
Proxies, each with the full power of substitution to represent the undersigned
and to vote all of the shares of IRT Property Company (the "Company") which the
undersigned is entitled to vote at the Annual Meeting of Shareholders of the
Company to be held at the Cobb Galleria Centre, Two Galleria Parkway, Suite 104,
Atlanta, Georgia 30339 on Wednesday, May 31, 1995 at 10:00 a.m. local time, and
any adjournments thereof (1) as hereinafter specified upon the proposals listed
below and more particularly described in the Company's proxy statement, receipt
of which is hereby acknowledged, and (2) in their discretion upon such other
matters as may properly come before the meeting.
A vote "FOR" the following is recommended by the Board of Directors:
1. Election of Directors as proposed in the accompanying proxy statement.
<TABLE>
<S> <C>
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY to vote for all nominees listed below
(except as marked to the contrary below)
</TABLE>
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE
A LINE THROUGH THE NOMINEE'S NAME IN THE LIST BELOW.)
D.W. MacLeod; M.M. Thomas; H.B. Gibbs, Jr.; S.W. Kendrick; T.H. McAuley; B.A.
Morrice; J.H. Nobil; L.P. Wolfort.
2. Amendment of the Articles of Incorporation to authorize Preferred Stock.
/ / FOR / / AGAINST / / ABSTAIN FROM VOTING
(PLEASE SIGN AND DATE ON THE REVERSE SIDE)
(OVER)
(CONTINUED FROM OTHER SIDE)
THE SHARES REPRESENTED HEREBY WILL BE VOTED AS SPECIFIED. IF NO
SPECIFICATION IS MADE, SUCH SHARES WILL BE VOTED "FOR" PROPOSALS 1 AND 2 AND
WITH DISCRETIONARY AUTHORITY ON ALL OTHER MATTERS THAT MAY PROPERLY COME BEFORE
THE MEETING OR ANY ADJOURNMENTS THEREOF.
Dated:____________________, 1995
________________________________
Signature of Shareholder
________________________________
Signature of Shareholder
PLEASE SIGN IN THE EXACT FORM AS
APPEARS AT THE LEFT AND DATE YOUR
PROXY. When signing as attorney,
executor, administrator, guardian,
trustee, etc., please give full title
as such.
